National Bank of Abu Dhabi (Nbad) is looking to strengthen its presence in Asia, and potentially Africa, says Frank Hamer, head of global transaction banking.
The bank plans to open a hub office in Singapore and has applied for a licence in Mumbai. It is also comtemplating the opening of an office in Nigeria, although it has yet to make a final decision on this.
The lender already has a Malaysia subsidiary and a representative office in Hong Kong, as well as a network across the Middle Eastern region and Europe.
By offering services to companies such as foreign currency management, trade finance, liquidity management, and collections, the bank hopes to tap into the growing business between Asian and Middle Eastern companies.
We are expanding across the borders, capturing supply chains from Europe to west Africa and east Asia, where we think the global GDP [gross domestic product] growth will happen. With this region we are very well positioned to cater to that, says Hamer.
The bank is gearing up for more activity in currencies such as the euro and the renminbi, which are growing in use across the region and globally. Internationalisation of companies has led to the increased use of the renminbi across Asian-Pacific countries, raising expectations that the currency will also become more dominant in neighbouring regions.
We will probably see more trade finance in the renminbi. Volumes are still not huge in the renminbi space, theyre growing, so there is still some time to develop that in this region. Other currencies will continue to grow, though the US dollar will remain important. For the UAE that provides the hedge [as the dirham is pegged to the dollar], says Hamer.
Through this corridor were seeing wealth creation and internationalisation of companies coming into the region. Trade finance involves arranging a lot of guarentees, and we have been working with leading Chinese, Korean and Japanese companies to help with their infrastructure projects [in the GCC], he adds.
Chinese banks are also increasingly expanding their operations in the Gulf. The top four Chinese banks, which manage more than half of Chinas assets, now have a presence in the Dubai International Financial Centre and are upgrading their licences to offer more services.
The UAE is Chinas largest export market in the Gulf, with bilateral trade between the country and Beijing increasing 16 times since 2002 to reach $40.42bn in 2012.